Sprint is currently in the midst of a buyout with Japanese company SoftBank that would give the foreign telecom control of not only the Now Network, but Clearwire as well, and infuse the company with some much-needed cash. Dish Network, however, hopes to derail these plans with a bid of its own, offering more cash than Softbank has on the table, as well as synergy with its existing television and and broadband packages.

Dish is offering Sprint roughly $25.5 billion for the carrier. This is about $5 billion more than SoftBank is offering, and would keep ownership of the company within the U.S. which, aside from simply making the "buy American" crowd feel better, would also alleviate at least some Homeland Security concerns. In the current political climate of cyber espionage, it's difficult to sell a U.S. telecommunications company to a foreign superpower without getting a phone call from the DHS. Not to say that the deal wouldn't go through (in fact it likely wouldn't be a problem at all), but that would be one less agency to appease.

This isn't the first time Dish has tried to throw a wrench in Sprint's plans, however. Back in January, Dish made a competing bid to buyout Clearwire for an extra $200 million (a total of $2.4 billion). That deal wouldn't have just gotten Dish extra spectrum and infrastructure, but would also have completely destroyed the Sprint/SoftBank merger, since Sprint acquiring Clearwire is a required condition of SoftBank's buyout. Interestingly despite the fact that Dish expects the deal to go through, it does not consider the purchase of Clearwire an absolute necessity for buying Sprint.

In a double-pronged attack, back in January, Dish also requested that the FCC suspend its review of the SoftBank acquisition until the Clearwire situation was clarified (which would have the added benefit of giving Dish more time to raise money). That request did not go over so well, and even resulted in Sprint claiming that Dish was trying to manipulate the FCC process.

We've known for a while that Dish wants to get into the wireless game and has been talking with every potential partner it can. The company owns a not-insignificant amount of wireless spectrum that's going unused and it has to either use it or risk being forced to give it up. Acquiring Clearwire does not look like a possibility for Dish, so the next logical step in its attempt to buy its way into the market is to purchase Sprint.

This deal certainly looks attractive from the outside, but it's unclear if it's too late to dissuade Sprint from selling, or if there might be other factors preventing Hesse from selling. What is clear is that Dish isn't going to let SoftBank gobble up the most lucrative U.S. wireless carrier that's willing to sell without exhausting all of its options.

Update: Dish is seriously not playing around. The company has created a new site with a ton of info about the proposed merger and why it's a fantastic idea. Warning: here be marketing speak.

Comments

So... does Dish want to improve Sprint, or do they just want to throw a wrench in everybody else's plans because they want that Clearwire spectrum?

I had dreams of a vastly improved Sprint, but this looks like it might just be a Montreal Screw Job. Help?

imneveral0ne

Brett Screwed Brett!

http://twitter.com/s99nj S. Ali

Dish owns valuable spectrum. Google and Dish had planned to acquire Clearwire for their own rumored wireless network.

Dave

This is easily the most important part of this discussion, and it's driving me crazy to not see it discussed in every article about Dish's bid for Sprint. Google is the X factor here. There were strong rumors of Google involvement in previous Dish moves. That is a huge deal, especially now that there is the potential for Google to acquire Sprint through Dish. The story isn't just the bid, the story is: What exactly is Google's involvement in this bid?

http://www.androidpolice.com/ David Ruddock

The ClearWire spectrum is worth nowhere near $25 billion, and Sprint is not making money right now. They'd have to turn things around in order for the deal to be worth it, and they'd need a plan to get Sprint back in the black fast. DISH would not be able to afford to keep a Sprint that loses money.

John O’Connor

this is a proposed buyout of Sprint/Clearwire. Obviously Clear on it's own is worth pennies on that dollar. This reaks of desperation. I certainly wouldn't want Dish to take ownership of Sprint for many reasons.

Egnimatic_Foolishness

The way I'm understanding it, is that Dish owns a chunk of wireless spectrum but its a use it or lose it scenario. Since Dish is not a wireless company, they presently can't use it. So now that crunchtime is coming they're wanting to buy sprint so that they can combine their network with Sprint's. Which means that they don't lose their spectrum and they can finally start making money with their spectrum

Cherokee4Life

I don't know if this is good or bad... I love Sprint and hate Dish.... buttt do I want my Wireless Carrier to "go overseas" I don't care about them tracking my phone or anything but it scares me

Hi David, correct me if i am wrong here. If Dish and Sprint Merge. I got the impression that they could help build LTE Network and expand it much quicker.

http://www.androidpolice.com/ David Ruddock

Eh, maybe. DISH won't exactly be flush after paying off $25 billion worth of Sprint shareholders. I'm sure they would want to speed things up, but I'm guessing whoever buys Sprint will be doing a lot of financial spring cleaning. Could mean rate hikes or tiered data - who knows.

Tommy Sanders

Thanks for time david. You do a great job on the podcast. I am sprint customer and they have been good too me . I know sprint is trying so hard too turn things around and I hope they get some help overall too make things better.

Tommy Sanders

I would like too see whatever company can help sprint turn the network around and expand the coverage.

Brian Spearman

"...would also alleviate at least some Homeland Security concerns."

You know Japan isn't the same as China, right? Japan is a huge American ally...

http://www.androidpolice.com/ David Ruddock

The DoJ already announced that there would need to be an inquiry into potential homeland security concerns for the deal to pass if SoftBank were to be the buyer.

Brian Spearman

Fair enough haha Sorry for my uninformed post, and thanks for the reply

Offering more cash, keeping it in US, "synergy" with TV... all fine and good sounding as statements (I would actually contest the positive aspects of the TV network/wireless network synergy...

The fact is, Softbank has Many orders of magnitude in assets overall to continue to support and invent in the network. And the motivation to do it, as a well established tech-forward company. ($4 trillion vs $11 billion.)

As where DiSHs motivations in the wireless business are akin to Comcasts in the ISP business. Not to provide you an excellent data service, but to sell you the bundles, the programing, the advertising, where their true money is made.

I for one, welcome our new Eastern overlords.

http://www.androidpolice.com/ David Ruddock

Bundling was my first thought as well, and I can't say that's a thought I relish in entertaining.

Cenarl

whatever happens I just hope we end up with a real third competitor with lots of coverage, I travel a lot in rural areas and if you ever needed to make a call you have to go with at&t or verizon and even they are not perfect.

http://www.facebook.com/ShinobiPhoenix Cody Shiranai

Eww... Dish sucks... Dish even has that much money? I guess when you rip off redneck Southern Christians as much as they do (AKA: Pulling a Disney), you can make a lot of money.